Public security ministry detects asset appropriation via payday loans

Police across Vietnam have recently detected cases involving asset appropriation by businesses posing as financial services firms, who conduct illegal debt collection.

Deputy Minister of Public Security Le Quoc Hung presented a report on the problem at a National Assembly Standing Committee meeting in Hanoi early this week on security, social order and safety.

He said in recent times, his ministry has instructed police in many localities to address debt collection and loan shark issues.

“Police have clearly analyzed the nature of these criminal groups, especially illegal debt collectors. It is not terrorism or slandering; the nature of this type of crime is the appropriation of assets,” Hung said, while mentioning two typical cases that clearly involve newly sophisticated tricks.

He noted their tricks have made serious impacts on security and order.

The first case involves asset appropriation by Ho Chi Minh City-headquartered law firm Phap Viet. On February 14, 2023, the Ministry of Public Security directed Tien Giang province police to crack down on the firm for asset appropriation via illegal debt collection.

Hung said it was an organized ring with large-scale operations conducted via a strict, three-level debt collecting process. The first involved making threatening phone calls to demand payment. The next step was threatening to kill the borrower’s family members, spreading libelous photos, or threatening job loss.

At the third level, coffins were delivered to the borrower’s workplace, and sometimes a gas tank or gasoline to heighten the threat. Schools attended by the borrower’s children were similarly targeted.

For such cases, Tien Giang police have prosecuted 54 defendants, including two deputy directors, 20 division heads, one secretary, and 31 staff members .

The second case involves criminals pretending to be a financial services company.

The deputy minister said that from November 2022 till now, his ministry has directed HCMC police to dismantle six groups accused of asset appropriation in the guise of consumer finance firms.

They include Mirae Asset Ltd., River Law Company’s HCMC Branch, Tieng Noi Hay Ltd., and Vietnam Prosperity Joint Stock Company.

HCMC police have prosecuted 64 defendants for appropriating assets. They have conducted administrative checks on a number of other firms like Galaxy Debt Trading Co., Easy Credit, and Shinhan Finance Company.

Hung said following police crackdowns in HCMC and Tien Giang, some organizations disguised as debt collection companies have changed their markets or downsized to deal with the police. This has resulted in a safer society nationwide compared to the time prior to the police campaigns, and residents supported the crackdowns, he added.

At the 21st session of the National Assembly Standing Committee on March 15, the Ombudsman Committee said it had received thoughts and aspirations from voters nationwide who claimed that pawn services, debt collection activities by enterprises registered as law firms, debt trading companies, and similar businesses had recently terrorized the spirit of borrowers and their families, frightening the general public and harming social order.